urban-gro, Inc. (Nasdaq: UGRO) (“urban-gro” or the “Company”), a
leading global horticulture company that engineers and designs
commercial Controlled Environment Agriculture (“CEA”) facilities
and integrates complex environmental equipment systems, today
reported its financial results for its first quarter ended March
31, 2021.
Bradley Nattrass, Chairman and CEO of urban-gro
stated, “We continued to build significant momentum on multiple
fronts throughout the first quarter of this year. Beginning with
our uplisting to Nasdaq and the closing of our $62.1 million
financing, we have never been in a stronger financial
position. With a cash position of $50 million, and having paid
down nearly all of our debt, we are in an ideal position to grow,
both organically and through acquisitions of complementary
companies. This is our third consecutive quarter where we have had
record revenues, positive adjusted EBITDA, and an increase in
quarter end backlog of signed contracts.”
“Looking to the future, we remain laser focused
on the execution of strategic growth initiatives within the food
and cannabis CEA space. This includes growing our footprint in the
United States as an increasing number of states continue to
legalize recreational and adult-use marijuana, gaining traction on
our expansion into Europe, increasing our higher margin service
offerings during both the engineering and design stages as well as
post start-up, and by launching an end-to-end turn-key solution for
CEA,” continued Mr. Nattrass.
First Quarter 2021 Highlights and
Comparisons:
- Record revenue of $12.0 million
compared to $4.2 million in 2020, an increase of $7.8 million, or
182%.
- Record Adjusted EBITDA of $0.5
million, compared to an Adjusted EBITDA loss of $0.9 million in
2020, an improvement of $1.4 million.
- Record income from operations of
$0.2 million, compared with a loss of ($1.4) million year prior, an
improvement of $1.6 million, driven by increased revenues and gross
margin.
- As of March 31, 2021, Company has
contractually committed orders (backlog) of a record $15.2 million,
an increase of $0.6 million from the previous record of $14.6
million as of December 31, 2020.
Nasdaq Uplisting and Public
Offering
- On February 17, 2021, and
complementing the uplisting to The Nasdaq exchange, the Company
consummated an underwritten public offering of 6,210,000 shares of
common stock, including the full exercise by the underwriters of
their option to purchase an additional 810,000 shares of common
stock to cover over-allotments. The shares were sold at a public
offering price of $10.00 per share, generating gross proceeds of
$62.1 million, before deducting the underwriting discounts and
other offering expenses. Net proceeds, net of all costs, were used
to repay debt, increase cash holdings, and for general working
capital purposes to position the company for future growth.
Conference Call Details
urban-gro will host a conference call and live
audio webcast to discuss the operational and financial results
today, May 11, 2021 at 5:00 PM ET. Interested participants and
investors may access the conference call by dialing (877) 524-8416
(domestic) or (412) 902-1028 (international). The live webcast will
be accessible on the Events page of the Investors section of the
urban-gro website, urban-gro.com, and will be archived for 90 days
following the event.
Use of Non-GAAP Financial Information
We define Adjusted EBITDA as net income (loss)
attributable to urban-gro, Inc., determined in accordance with
GAAP, excluding the effects of certain operating and non-operating
expenses including, but not limited to, interest expense,
depreciation of tangible assets, amortization of intangible assets,
impairment of investments, and stock-based compensation that we do
not believe reflect our core operating performance. We use Adjusted
EBITDA as a measure of our operating performance. Adjusted EBITDA
is a supplemental non-GAAP financial measure, and it is not a
substitute for net income (loss), income (loss) from operations,
cash flows from operating activities or any other measure
prescribed by GAAP.
Our board of directors and management team focus
on Adjusted EBITDA as a key performance and compensation measure.
We believe that Adjusted EBITDA assists us in comparing our
performance over various reporting periods because it removes from
our operating results the impact of items that our management
believes do not reflect our core operating performance.
There are limitations to using non-GAAP measures
such as Adjusted EBITDA. Although we believe that Adjusted EBITDA
can make an evaluation of our operating performance more consistent
because it removes items that do not reflect our core operations,
other companies in our industry may define Adjusted EBITDA
differently than we do. As a result, it may be difficult to use
Adjusted EBITDA to compare the performance of those companies to
our performance. Adjusted EBITDA should not be considered as a
measure of the income generated by our business or discretionary
cash available to us to invest in the growth of our business.
The following table reconciles net loss
attributable to the Company to Adjusted EBITDA for the periods
presented:
|
|
Three months Ended March 31, |
|
|
|
2021 |
|
|
2020 |
|
Net Loss |
|
$ |
(1,588,582 |
) |
|
$ |
(1,695,631 |
) |
Interest expense |
|
|
317,443 |
|
|
|
298,634 |
|
Interest expense – BCF |
|
|
636,075 |
|
|
|
– |
|
Loss on extinguishment of debt |
|
|
790,723 |
|
|
|
– |
|
Stock-based compensation |
|
|
290,805 |
|
|
|
432,645 |
|
Depreciation and amortization |
|
|
55,684 |
|
|
|
60,553 |
|
Adjusted
EBITDA |
|
$ |
502,148 |
|
|
$ |
(903,799 |
) |
Profit and Loss – Q1 2021 and 2020
|
|
Three months ended |
|
|
March 31, 2021 |
|
March 31, 2020 |
|
|
|
|
|
Revenues |
|
$ |
12,034,358 |
|
|
$ |
4,261,003 |
|
Cost of
revenues |
|
|
9,393,713 |
|
|
|
3,147,515 |
|
Gross
Profit |
|
|
2,640,645 |
|
|
|
1,113,488 |
|
|
|
|
22 |
% |
|
|
26 |
% |
|
|
|
|
|
Operating
expenses |
|
|
2,487,814 |
|
|
|
2,528,053 |
|
|
|
|
|
|
Earnings / (Loss) from
operations |
|
|
152,831 |
|
|
|
(1,414,565 |
) |
|
|
|
|
|
Non-operating income
(expense) |
|
|
|
|
Interest expense |
|
|
(317,443 |
) |
|
|
(298,634 |
) |
Interest expense - BCF |
|
|
(636,075 |
) |
|
|
- |
|
Loss on extinguishment of debt |
|
|
(790,723 |
) |
|
|
- |
|
Other income |
|
|
2,828 |
|
|
|
17,568 |
|
Total non-operating
expenses |
|
|
(1,741,413 |
) |
|
|
(281,066 |
) |
|
|
|
|
|
Comprehensive income /
(loss) |
|
$ |
(1,588,582 |
) |
|
$ |
(1,695,631 |
) |
|
|
|
|
|
Loss per
share: |
|
|
|
|
Net loss per share - basic and
diluted |
|
|
(0.20 |
) |
|
|
(0.36 |
) |
|
|
|
|
|
Weighted avg shares used in
computation |
|
|
7,831,959 |
|
|
|
4,739,830 |
|
About urban-gro, Inc.urban-gro,
Inc.® (Nasdaq: UGRO) is a global engineering and design
services company focused on the commercial horticulture
market. With experience in hundreds of Controlled
Environment Agriculture (CEA) facilities spanning millions of
square feet, we engineer, design and integrate complex
environmental equipment systems into high-performance
facilities.
Once operational, urban-gro’s
gro-care® Managed Services Platform leverages the company's
expertise to reduce downtime, provide continuity, and drive
facility optimization. Operating as a crop-agnostic solutions
provider in both food and cannabis CEA sectors, our crop-focused
end-to-end approach provides a single point of accountability
across all aspects of growing operations.
Visit urban-gro.com to discover how we help
you gro plants and gro profits.
Safe Harbor StatementThis press
release contains forward looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. When used
in this release, terms such as “believes,” “estimates,” “should,”
“could,” “would,” “plans,” “expects,” “intends,” “anticipates,”
“may,” “forecasts,” “projects” and similar expressions and
variations as they relate to the Company or its management are
intended to identify forward-looking statements. Such
forward-looking statements are based on current expectations,
forecasts, and assumptions that involve risks and uncertainties
that could cause actual outcomes and results to differ materially
from those anticipated or expected, including statements related to
the demand for our services and products, our ability to manage the
adverse effect brought on by the COVID-19 pandemic, our ability to
execute on our strategic plans, our ability to achieve positive
cash flows or profitability, our ability to achieve and maintain
cost savings, the sufficiency of our liquidity and capital
resources, and our ability to achieve our key initiatives for 2021.
A more detailed description of these and certain other factors that
could affect actual results is included in the Company’s filings
with the Securities and Exchange Commission. Readers are cautioned
not to place undue reliance on these forward-looking statements,
which speak only as of the date hereof. The Company undertakes no
obligation to update any forward-looking statements to reflect
events or circumstances after the date hereof, except as may be
required by law.urban-gro Investor Relations
Contact:Jenene ThomasChief Executive OfficerJTC Team,
LLCT: 833.475.8247 investors@urban-gro.com
Media Contact:Stan WagnerManaging
DirectorMaverick Public Relations T:
303.618.5080stan@themaverickpr.com
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